TRANSPORTATION

DISTRIBUTION MANAGEMENT
 TRANSPORTATION

• focuses on careers in planning, management, and movement of people,

materials, and goods by road, pipeline, air, rail and water and related
professional support services such as transportation infrastructure
planning and management, logistics services, mobile equipment and
facility maintenance.
 IMPORTANCE

• Without development of transportation neither mass production

nor distribution is possible.
• Transportation helps in mass production. Whether it is to purchase
and bring raw materials or it is to distribute finished goods, one or the
other means of transport is necessary. This expands old markets and
creates new ones.
 IMPORTANCE OF PHYSICAL
DISTRIBUTION

1. Creating Time and Place Utility:

Physical distribution activities help in creating time and place utility. This is
done through transportation and warehousing.Transportation system
creates place utility as it makes available the goods at the right place
where they are required. Warehousing creates time utility by storing the
goods and releasing them when they are required.
 IMPORTANCE OF PHYSICAL
DISTRIBUTION

2. Helps in Reducing Distribution Cost:

Physical distribution cost account for a major part of the price of the
product. If these costs are handled systematically, decrease in costs of
product can be there. Proper and systematic planning of transportation
schedules and routes, warehousing location and operation, material
handling, order processing, etc. can easily bring in cost economies.
 IMPORTANCE OF PHYSICAL
DISTRIBUTION

3. Helps in Stabilisation of Price:

Physical distribution helps in maintaining stable prices. Even customers
expect price stability over a period of time. Proper use of transportation
and warehousing facilities can help in matching demand with supply and
thus ensure stabilisation of price.
 IMPORTANCE OF PHYSICAL
DISTRIBUTION

4. Improved Consumer Services:

Consumer service in physical distribution means making products in right
quantity available at right time and right place i.e. place where customer
needs.
 TRANSPORT DECISIONS

 Mode/Service selection
 Freight consolidation
 Trade-off between transportation cost and customer responsiveness
 Vehicle Routing
 Seperate and Single Origin and Destination Points
 Multiple Origin and Destination points
Routing with a Coincident Origin/Destination Point
 MODES OF TRANSPORTATION

• Road Transport:
This is an ancient form of transport and plays an important role
in marketing. Road transport may be through different means like
transport by animals (like bullock, camel), transport by human beings (like
coolies or porters), transport by automobiles (like scooters, auto
rickshaws, cars, truck buses etc.). Road transport is flexible and
economical. However, it is unsuitable for long distances.
 MODES OF TRANSPORTATION

• Railways:
It is suitable for transporting bulk goods over long distances. It is
an economical mode because large volume of traffic is handled over large
network of railways. However, it is inflexible as it is unfit to transport
goods to rural areas. Further, it involves huge maintenance expenditure.
 MODES OF TRANSPORTATION

• Water Transport:
Water way is an important mode of transport for heavy and
bulky goods in large quantities. It consists of inland water transport and
ocean transport. Inland water transport is used for transporting goods
within county and ocean transport is used to transport goods to other
countries. Water transport is a cheapest form of transport, having great
carrying capacity and is highly suitable for heavy and bulky goods, but it
has low speed and higher degree of risk due to seasonal difficulties.
 MODES OF TRANSPORTATION

• Air Transport:
Of late air transport has assumed significant importance as a
mode of transport. Although it accounts for a small percentage of
transportation, it is useful for perishable items, overnight packages,
emergency supplies etc. The main disadvantage of air transport is that it
has high freight charges, low carrying capacity and too much dependence
on climatic conditions.
 MODES OF TRANSPORTATION

• Pipelines:
These are specialized carriers design to transport the crude and
refined petroleum and natural gas from wells to refineries and further to
distribution centre. It is an economical mode as it involves less handling
and labour cost, but it is the slowest mode of transportation and very
limited in number.
 ROUTING & SCHEDULING

• ROUTING is the process of mapping out the unique ways that one or more
vehicles will take while they deliver or collect stock from each of their stop
points. This involves considering the sequence of stops, and the ways that will
be taken by each vehicle to successfully achieve this outcome.
• SCHEDULING is the process of calculating and assigning an arrival time for
each stop, with drivers being assigned shifts that adhere to working hours.
• ROUTE OPTIMIZATION follows these steps and is the process of
analysing the projected routes and refining them to be more efficient. This can
be achieved by taking a range of factors into account such as vehicle type,
type of stock, road restrictions etc.